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MathidiaMathematics Academy
Mathematical reasoning and modelling
Lesson 74 of 75
Challenge

Financial decision making

Objective. Compare tariffs, discounts and value using evidence.

  1. 1. Learn
  2. 2. Worked example
  3. 3. Practice
  4. 4. Feedback
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Learn: the key idea

Financial decision making compares different offers, tariffs or discounts using mathematics to judge which represents the best value for a given situation. This often involves calculating unit prices, applying percentage discounts, or working out total costs including fixed and variable charges, then comparing the results fairly. Evidence-based comparison means calculating actual totals rather than guessing from the size of a discount alone. Example: a 20% discount on £50 saves £10, giving a final price of £40, which should be compared directly against any rival offer's total price.

Worked example

Shop A sells a jacket for £80 with a 25% discount. Shop B sells the same jacket for £70 with a 10% discount. Use financial decision making to find which shop offers the lower final price.

£80.00
Money illustration for £80
  1. 1Calculate Shop A's discount: 25% of £80 = £20, so the final price is £80 − £20 = £60.
  2. 2Calculate Shop B's discount: 10% of £70 = £7, so the final price is £70 − £7 = £63.
  3. 3Compare the two final prices: £60 versus £63.
  4. 4Shop A offers the lower final price of £60.

Answer: Shop A, at £60

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Common mistake. Pupils often assume a larger percentage discount is always the better deal without checking the original price; always calculate the actual final cost of each offer before deciding which is cheaper.

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